India is witnessing a surge of tech investments: Apple iPhone assembler initiates efforts for a new plant
India has witnessed a surge of inward investment in recent weeks, with Facebook, Google, and others issuing close to $20 billion into Jio Platforms, billionaire Mukesh Ambani's mobile internet venture.
Apple assembly partner Pegatron is initiating arrangements for its first plant in India, summing to a massive entrance of foreign tech investments in the country this year.
In June, the government set out a $6.6 billion plan to woo the world's top smartphone producers, granting financial incentives and ready-to-use manufacturing clusters. Pegatron is now establishing up a local subsidiary and joining fellow Taiwanese electronics assemblers Foxconn Technology Group and Wistron, who have previously been making some iPhone handsets in southern India.
With numerous factories in China, Pegatron is the second-largest iPhone assembler and relies on Apple for more than half of its business. Like its peers, it will set up in southern India, according to a person close with its plans who requested not to be named.
Foxconn, also recognized as Hon Hai, and Wistron are contemplating to develop their operations in the country, and Pegatron's entrance can be marked as a defensive move to defend its part of budget iPhone manufacturing, according to Matthew Kanterman of Bloomberg Intelligence.
Google has committed to contributing $10 billion (Rs. 75,000 crores) over the next five to seven years to advance India's digital transformation and Amazon.com has announced it aims to export $10 billion of made-in-India goods by 2025. When Jeff Bezos visited the country in January, he stated “The 21st century is going to be the Indian century.”
The country contributes an enormous supply of skilled labour as well as a domestic market of a billion mobile connections. Only about half of those are smartphones, however, leaving untapped potential that is attractive to growth-hungry global brands like Apple, Xiaomi, Oppo, and Samsung Electronics.
For assemblers like Pegatron, exports would also be an attractive opportunity, particularly at a time of worsening business relationships between Washington and Beijing making it necessary to have a different geographic base. Smartphones are a focal point for Prime Minister Narendra Modi's much-touted Make in India program. Ravi Shankar Prasad, minister for information technology and electronics, has announced the goal is for brands and manufacturers to transport the complete supply chain to the country, not just the end-stage assembly.
Quoted by local media, Prasad stated India requires not only the “bridegroom” but also the “wedding procession.” He also displayed an 'Assembled in India' iPhone XR.
India will grow as a global manufacturing core for both components and the entire assembly of smartphones and other devices, announced Pankaj Mohindroo, chairman of the Indian Cellular & Electronics Association.
The group's three dozen members include Foxconn, Wistron, Google, Apple, Oppo, and others. “The focus is shifting from making for India to exports and the $400 billion electronics manufacturing that India is targeting by 2025 will be dominated by exports,” Mohindroo spoke through the phone from New Delhi.
